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If the world unfolded as predicted by Bill Gates, printed newspapers would be dead in the next four years. While he may turn out to have been directionally correct and merely wrong about the timing, it's been interesting to watch the world change around Microsoft and slowly render the software giant impotent at a time when newspapers continue to hang around and even start new print publications.

While it is surely premature to pronounce dead a company with a 263.2 billion USD market capitalization, the writing is on the wall: the era of the PC has ended. The Web is the center of the universe and the PC is just one of many peripherals.

Now Microsoft is saying that openly. After a series of high-profile failures (PlaysForSure, Zune, and now Vista) from Redmond, it needs to change its way of thinking from top to bottom to embrace Web services. (This is why it wants to buy Yahoo, an effort that I think will fail even if it succeeds.)

The problem is that MS has no particular advantage as a service provider -- other than mountains of available cash to fund development, which often is not the advantage you might expect. On the minus side, it has a demonstrated track record of incompetency and inability to stick with an idea long enough to make it work.

Just this week Microsoft told people who made purchases from its failed MSN Music online store that "as of August 31, 2008, we will no longer be able to support the retrieval of license keys for the songs you purchased from MSN Music or the authorization of additional computers."

Microsoft is surrounded by smart, more agile competitors, many of which have nothing to lose. As we move from desktop to mobile-centric Internet access, free Linux -- especially in the form of the Google-financed Android project -- will be the dominant platform. This will lead to an explosion of small-scale disruptive, innovative development, overwhelming Microsoft like an attack of fire ants.

Is there any value to newspapers in studying this, other than misery loving company?

I think it illuminates two options for newspaper companies, which are in many ways in the same trap as Microsoft.

One path is to embrace and leverage processes modeled on the principles of "open source" development, as Google is doing. This requires abandoning the arrogant hostility toward the reader that you find in many newsrooms, banning the language "unwashed masses" from thought as well as conversation. The Founding Fathers referred to "a decent respect to the opinions of mankind," a concept disturbingly absent among many journalists who are eager to latch onto other concepts expressed in that era, such as freedom of the press.

The other path is suggested by a line generally attributed to F. Scott Fitzgerald: "The cleverly expressed opposite of any generally accepted idea is worth a fortune to somebody." This essentially is Apple's path, the closed system where value is created through enforced simplicity and clarity. But can newspapers cleverly express anything? The quality of writing, and the quality of thought, in most of America's 1,400 or so newspapers is not encouraging.

My rule of thumb is a simple one: Use the right tool for the right job. The Internet's strength is collaborative interaction; print's strengths are linearity, focus and serendipitous discovery.

So in my world newspapers should use the Internet to execute a Google-like, open-source-inspired, conversational approach to journalism, while remaking print around focus, quality, depth and thought-provoking discovery. I'm troubled when I see newspapers trying to badly copy the Web's strengths into print (i.e. those awful Page 2 summaries of news you already know about) and failing to invest in journalism worth reading.

So in my vision of the future, the Web is not exactly the center of the media universe. It's one of the centers, and it's optimized for open interaction and community-driven conversation. Print should focus on our need for periodic escape from the cacophony of the bazaar. If we do that, perhaps newspapers will still be around for awhile. Maybe even longer than Microsoft. Who knows?

In an awesomely detailed post, the editor of Schamper, the student newspaper at the University of Gent (Belgium) describes how he -- a philosophy major -- built a Web-centric content management system that outputs to Adobe InDesign for print, all based on the open-source Drupal CMS framework. How integrated is it? Well, when an editor opens a story, it's locked so others can't modify it. When it's stored, the XML output is updated and InDesign refreshes the layout. And oh, by the way, there's also a public-facing website. Great work, all integrated by someone who's not a professional programmer, and based on free code.

Drupal is disruptive innovation in action. Many people mistakenly think it's a blogging platform. It began as a communications tool for Belgian student Dries Buytaert to communicate with his dormitory buddies. It's built on open-source foundations (PHP, MySQL or Postgres). Over the last several years it's grown into a powerful, flexible and reliable tool for some pretty high-end projects. I believe Bluffton Today was the first newspaper to use it for the core of its site; now quite a few dailies up to the Virginian-Pilot are using it to power their websites. Now it's moving into print production.

E&P reports that the Cincinnati Post will shut down at the end of the year, when its joint operating agreement with the Cincinnati Inquirer expires. The Post's circulation has declined from 188,000 some 30 years ago to 27,000 weekdays today. For whatever reasons, E.W. Scripps Co. won't attempt to keep the brand alive by continuing to operate the newspaper's website.

See also: Jon Fine's Business Week column in which he fantasizes about a newspaper going online-only.

Journalists are chronically confused about why people read newspapers. As Clayton Christensen has pointed out, the best way to understand product-market relationships is this: People don't buy products; they hire products to get specific jobs done.

One of the reasons people read newspapers involves the recycling of downtime. If you read a newspaper while eating lunch, you can entertain yourself while feeding yourself. Or perhaps you're using it to avoid people you really don't want to talk with. Or escape the uncomfortable feeling that you're dining alone in a crowded restaurant. Or whatever.

In any case, there's probably a very personal reason involved that is something quite different from "getting the news" and stepping up to your responsibility to be a well-informed citizen. Those are benefits, especially benefits to society, but they may be quite disconnected from the actual decision to pick up the newspaper and read it.

Which brings me to the iPhone. In a contest to serve any of these purposes, which one is going to win?

1. A newspaper, whether it be the daily Bugle or the weekly Whining Alternative.
2. Everything on the entire Internet, interactive and in color.

Easy: #2 is going to paste #1.

The point here is not to predict the ultimate victory of the iPhone over all forms of media. The iPhone is at this point a perfect product because it hasn't been sold and nobody has had a chance to discover the limitations and annoyances that inevitably come with real-world products.

The point is simply to illustrate why discussions of old-media business models such as charging for content are pointless. We are awash in a sea of new choices competing for our time and our attention. Some of these new choices are inherently superior solutions for some of the jobs for which print media used to be hired.

Editors Weblog cites a study from the Newspaper Audience Databank that shows baby boomers in Canada still consume print (56% weekdays, 78% weekly cume): "Their readership habits have changed little over the past 20 years."

That should not be surprising. If you analyze the (publicly available) GSS data on U.S. readership and track birth year cohorts across time, you'll discover that statement to be generally true of ALL age cohorts. For any cohort, there is only a very slight downward trend over time.

The point is that media consumption patterns are set early in life, and tend to persist. The change that endangers the newspaper business model is not one that involves readers losing the habit. It is, instead, a generational change that involves losing the actual readers from the population pool. They are being replaced by people who grew up with iPods and instant messaging and SMS and the Web. And the new generation moving into place will grow up with on-demand video, primarily through the Web.

This change is slow enough that newspaper managers can miss it, mistaking temporary fluctuations for trends. One publisher recently crowed that his circulation was up 1.24% daily while most others were down, and concluded that he's strategically right and everybody else is wrong. Don't mistake the weather for climate.

Om Malik profiles a company he calls "the American Idol of digital photography." The idea: Get photographers to compete online to get their work printed in a magazine. The site: JPG magazine.

It's human nature to compete for scarce resources. Online space isn't scarce, but print always is scarce. I wonder what use newspapers could make of this principle. Hmm.

The article also has some hints about how JPG's website was built, taking advantage of new Web services such as Amazon.com's S3.

We think of Amazon.com as a retailer, but it's unveiled some powerful new web services that can make it possible for disruptive new Web 2.0 sites to be developed:

Amazon Simple Storage Service (Amazon S3) enables massive online data storage and simple HTTP delivery in a "cloud," in which you pay only for the storage and bandwidth you use. This makes it possible for a video site, for example, to grow rapidly without having to manage the planning, investment and project management processes associated with adding storage arrays.

Amazon Elastic Compute Cloud (Amazon EC2) extends this principle to computing processes. You can configure a virtual server image -- starting with a Fedora Linux base -- that includes all your applications and configuration. To add a server, you simply place an electronic order through a web services API. Absolutely all of the server setup processes from then on are automated. Your servers are up and running within minutes.

Pricing on both is cheap and tied directly to what you use. Need more servers? Start them up. Need fewer? Release the resources to the grid.

The disruption will kick in as entrepreneurs imagine new ways to use this power.

It's not just about running webservers. Think video transcoding. CGI rendering. Engineering computations. A university could configure an on-demand scalable parallel computing farm for scientific modeling. Since it's all done on a machine-hour basis, 100 machines could work for one hour instead of 1 machine for 100 hours. This doesn't apply to all classes of problems, but many new doors are opened.

Peter Krasilovsky and Jay Small have some thoughts about local online revenue growth and the inflection point at which a web operation outsells the print operation.

I've run those numbers, too, guessimating the future. It's total nonsense, of course; you cannot predict the future by extrapolating from the past because there are too many variables, you don't have enough data, and your model is doomed to be pathetically naive. But it's great discussion fodder to be able to say "Look, here in 2012, 2013, 2014, whatever, everything changes. What does it mean? What do we have to do to be ready?"

Several years ago economist Robert Picard drew this graph, which was used in a World Association of Newspapers strategy report:

... omitting any numbers and forcing us all to guess. Rosenthal Alves tells me Picard has updated his graph with some animations but still, sadly, no dates.